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Choosing an online payroll service is both easier and more complicated than ever before thanks to the hundreds of options to choose from.
There is no shortage of options on the plus side, which increases the likelihood of finding the perfect service for your business.
Conversely, with so many services to compare, making a final decision isn’t an easy task.
However, we’ve worked with dozens of teams and have been involved in paying hundreds of people over the years. With our combined experience, we narrowed it down to the five best online payroll services to choose from.
The 5 Best Online Payroll Services Options to Consider
- Gusto – Best payroll service for sole proprietors
- QuickBooks – Best for integrating with QuickBooks Accounting
- ADP – Best for startups and fast-growth companies
- SurePayroll – Best for household employees
- Payroll4Free.com – Best free online payroll service
#1 – Gusto — The Best For Sole Proprietors
As a sole proprietor, it’s easy to overlook the importance of choosing an online payroll service. After all, you’re the only employee, so you don’t see much need for professional help.
But then you meet Gusto.
Companies of all sizes can use it effectively, but it’s offerings for sole proprietors and microbusinesses are where it really shines.
From tax payments to year-end filings, Gusto lets you manage everything electronically. This saves you time and money, while also eliminating the possibility of something important getting lost in the mail.
Or worse. A costly human error doing manual entries.
Furthermore, once you load your information into the system, you can set it to run payroll automatically. So, you can stop manually paying yourself and tracking your taxes, too.
Plus, every time you hire a new employee, you can easily add them to your new payroll system. Furthermore, Gusto offers a complete onboarding process, so your new employees feel right at home.
And you don’t have to lift a finger
Overall, Gusto is a modern solution to processing payroll online and it’s perfect for solopreneurs and microbusinesses looking for a better way to run payroll and manage tax payments.
#2 – QuickBooks — The Best For Integration with QuickBooks Accounting Software
When it comes to name recognition, you won’t find many online payroll services with as much clout as QuickBooks. This is due in large part to the fact that many businesses are already familiar with QuickBooks accounting software.
If you want an online payroll provider that efficiently integrates with your QuickBooks accounting software, start here.
Top features include:
- Industry-leading direct deposit speed: Your employees want to be paid on time, every time. And QuickBooks makes sure this happens. Direct deposits are quick and no later than the next business day.
- Electronic filing: Just the same as Gusto, electronic filing is never a concern with QuickBooks. From your monthly tax payments to year-end filings, you can cut paper out of this part of your business.
- Easy to set-up: With step by step tutorials, the set-up process should only take a few minutes. And once you’re familiar with the interface, it’s easy to add and remove employees.
The benefits of QuickBooks are powerful, but there are some potential drawbacks to consider:
- It’s best (and easiest) to integrate with QuickBooks accounting software: If you use this software, it’s not a problem. But if you don’t, you may find integration challenging.
- Hit or miss customer service: As one of the largest payroll companies on the list, QuickBooks often struggles to keep up with the demands of its customers. If you have a question or concern, it may take a while to get help.
When it comes to pricing, QuickBooks has something for everyone. In addition to a free trial, you can start for as little as $13.50/month plus $4/month for each additional employee.
#3 – ADP — The Best For Scaling Companies
Much the same as QuickBooks, ADP is a well-known payroll service that offers solutions for businesses of all sizes.
For small companies and startups looking to scale in the future, ADP is an excellent choice. The system can scale alongside your company, thus ensuring that you never experience payroll growing pains.
Here’s what you’ll like about ADP:
- Flexibility: No two businesses are the same, and ADP understands that. And for that reason, they have flexible plans that allow you to get everything you need and nothing you don’t.
- 24/7 customer support: When it comes to customer support, ADP is the top-dog on this list. With the ability to connect with an experienced support professional 24/7, you never have to wait for assistance.
- Easy to integrate with a variety of HCM solutions: As you grow, you may need ADP for more than payroll. It has products for things such as recruitment, retirement, benefits, and outsourcing.
Now, let’s check out a couple of downfalls:
- Upcharges: As you get up and running, you’ll find that ADP tries to sneak in upcharges on you. For example, there are set-up charges that can add up.
- Required to call for a quote: Much the same as SurePayroll, you have to call ADP if you want a pricing quote. This can slow down the process, especially when competitors like Gusto and QuickBooks provide transparent online pricing.
For scaling companies interested in doing business with a well-known provider that offers a variety of solutions, ADP is a good choice.
#4 – SurePayroll — The Best For Household Employees
For more than 20 years, SurePayroll has been serving small businesses in every industry imaginable.
While any type of business can use SurePayroll, it’s payroll service for household employees stands out from the crowd.
If you have a household employee, such as a nanny or butler, you’re required by law to pay payroll taxes. SurePayroll has designed its service to be simple, cost-effective, and straight-forward, which is just what busy household employers are looking for.
Top features include:
- Run payroll anytime, from anywhere: With SurePayroll, you can run payroll from a computer, smartphone, or tablet. As long as you have internet access, you can get the job done.
- Full-service and self-service options: With full-service, SurePayroll takes over the entire process on your behalf. With self-service, you’re responsible for inputting the data necessary to run payroll.
- Tax filing guarantee: It doesn’t matter if you choose full-service or self-service, you’re backed by SurePayroll’s tax filing guarantee. If they make an error in your tax liability calculations, they’ll pay the penalty. Talk about peace of mind!
Potential downfalls of SurePayroll include:
- It’s designed for small businesses. Even though mid to large-sized businesses can use the service, it’s features are geared more toward those with 100 employees or less.
- Outdated interface. Upon signing up, you’ll realize that the SurePayroll interface isn’t in line with what you’d expect in 2020.
SurePayroll also excels in customer support, with the option to contact an experienced payroll professional via phone, live chat, or email.
In regards to price, SurePayroll requires you to complete the quote form on its website for more information. Cost depends on the number of employees and whether you choose full-service or self-service.
For household employers and small businesses, SurePayroll is solid across the board.
#5 – Payroll4Free.com — The Best Free Online Payroll Service
Many sole proprietors and small businesses run their own payroll to save money. Even if it’s time-consuming and stressful, they’d rather deal with it than part with a dollar.
With Payroll4Free.com, you may be able to get the best of both worlds. If money is what matters most, you’re not likely to find a better deal.
As the name suggests, Payroll4Free.com allows you to use its service free of cost. It’s able to do so by placing ads inside the software you use to run payroll. Yes, it can be distracting, but it’s a good tradeoff if you’re looking to save.
Top features of Payroll4Free.com include:
- Free for up to 25 employees: As long as you have 25 employees or fewer, Payroll4Free.com is always free.
- Variety of free add-ons: You can do more than run payroll with Payroll4Free.com. Add-ons include a payroll calculator, employee portal, and detailed reporting.
- Direct deposit or paper check: Let your employees choose, so you can pay them the way they want.
Areas of concern include:
- Outdated interface: If you want a pretty, intuitive interface, Payroll4Free.com isn’t for you. It’s outdated and difficult to navigate.
- Ads: Payroll4Free.com has to make money somehow, and they do so by placing ads inside the software. This can be distracting to both you and your employees.
As a smaller online payroll service, Payroll4Free.com is able to provide above-average customer support via email and phone.
Although it lags behind the competition in some key areas, Payroll4Free.com is 100% free. And for some, that’ll always be enough to win them over.
When Does It Make Sense to Invest In Online Payroll Services?
Regardless if you have one employee or 100+, payroll compliance is extremely important. Not only does it ensure that your employees get paid on time and in full, but it also helps protect against costly penalties.
Whether you rely on a payroll service is a personal decision. You don’t have to use an online service, but you do have to maintain compliance with all local, state, and federal tax agencies.
It makes sense to invest in an online payroll service if you want:
- To avoid the time-consuming process of running payroll yourself
- To ensure accuracy
- Someone on your side who can help you maintain compliance
- A service that provides your employees with important information and answers to their questions
For those who are on the fence, comparing the pros, cons, and features of multiple services can help you decide if it’s the right decision.
Methodology For Choosing The Best Online Payroll Service
There is no right or wrong way to evaluate online payroll services, but some details deserve more attention than others. We focused on a variety of factors to ensure a comprehensive breakdown of each, with a focus on:
Some people want nothing more than the basics, while others need a service with a full set of features.
Top features include a payroll calculator, direct deposit, electronic tax payments, and the ability to manage both W-2 employees and 1099 contractors.
Built-In HR Features
On top of basic payroll features, it’s important to consider benefits, employee dashboards, and other critical HR features. This is especially true if you’re a small business, since you probably don’t have a human resources department.
Most online payroll services include some type of benefits management, including things like:
- Group health insurance coverage
- Vacation, time-off requests, and holidays
- A self-service employee dashboard
- Automated taxes, depending on your state
Money, money, money. When choosing a payroll service, consider the financial impact on your business. Some services, such as Payroll4Free.com are free of cost, while others, such as Gusto, are at the high end of the scale.
The key is to understand what you get in exchange for your money.
Customer support is a critical component of any online payroll service. Even if you know how to use the system and trust your provider to do the right thing, there are sure to be times when you have questions.
The best providers in regards to customer support are available via phone, email, and live chat.
However, there are other high-quality options to choose from.
So, don’t forget to use the methodology outlined above as you go through the process of choosing the best online payroll service for your business.